Sprint Nextel Corp. v. Simple Cell, Inc., 2013 WL 3776933 (D. Md. July 17, 2013)

Sprint Nextel Corp. v. Simple Cell, Inc., 2013 WL 3776933 (D. Md. July 17, 2013) (4th Cir.)

Sprint alleged the defendants committed these acts in violation of the Computer Fraud and Abuse Act: (1) trafficked in confidential codes through which individuals could gainaccess to Sprint’s network (§ 1030(a)(6)); (2) intentionally accessed Sprint’s protected network without authorization (§ 1030(a)(5)(C)); and (3) accessed its protected network with intent to defraud and by accessing such network furthered the intended fraud and obtained anything of value (§ 1030(a)(4)).

The court ruled on multiple issues of law:

  • The CFAA is not subject to the heightened pleading standard of Rule 9(b) that is required for common law fraud.
  • The requisite “loss” under the CFAA plainly contemplates consequential damages such as costs incurred as part of the response to a CFAA violation, including the investigation of an offense.
  • The CFAA permits plaintiffs to aggregate multiple intrusions or violations within a 1-year period for the purposes of meeting the $5,000 statutory threshold.
  • Plaintiff’s loss allegations were sufficient to meet the pleading standards: responding to the defendants’ contacts with Sprint customer service, investigating and assessing the possible impairment to the integrity of its protected computer networks, taking action to counteract the defendants’ theft, and conducting
    damage assessment regarding [the defendants’] collection and dissemination of Sprint Phones and codes, as well as tracking down fraudulently sold phones.

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